Large CPG Marketers Shifting to Digital

by | 2 minute read

Mar­keters who are pro­mot­ing brand­ed pack­aged foods have been feel­ing pinched ever since the reces­sion start­ed. Some con­sumers have been migrat­ing to less-expen­sive pri­vate label prod­ucts.CPGshopper  Oth­er con­sumers are spend­ing more mon­ey on fresh prod­ucts and local or region­al brands. Accord­ing to an Adver­tis­ing Age write-up that cov­ered the industry’s recent Con­sumer Ana­lyst Group meet­ing, these mar­keters are  real­iz­ing they need a fresh prod­uct devel­op­ment approach and increased invest­ment in dig­i­tal media.

Con­sumers are chang­ing the way they think about and buy food. Only a decade ago, a heavy coupon cam­paign to accom­pa­ny the launch of a new food prod­uct or prod­uct exten­sion, along with TV spots, was enough to win sales. Food mar­keters often com­pet­ed on the basis of how many new prod­ucts they turned out each year. Going for­ward, big food com­pa­nies say they’ll be  devel­op­ing few­er prod­ucts and they’ll be putting few­er ingre­di­ents in each prod­uct. These prod­ucts are more like­ly to appeal to today’s health con­scious con­sumers, espe­cial­ly savvy moms who spend a lot of time dis­cussing what they don't like about processed food on social media.

Food mar­keters have also been squeezed by the high­er cost of ingre­di­ents and the very real lim­it on prices that con­sumers have set as a result of tight house­hold bud­gets. While mar­keters are look­ing for oper­a­tional effi­cien­cies, they’re intent on spend­ing more on dig­i­tal adver­tis­ing.  The Oreo and Tri­dent brands, part of Mon­delez, will spend 50% of their U.S. media bud­get on dig­i­tal by 2016. Kraft plans to con­tin­ue its for­ay into dig­i­tal, not­ing that it has been able to sub­stan­tial­ly reduce adver­tis­ing costs while yield­ing the same lev­el of impres­sions. And, oth­er mar­keters, such as ConA­gra, believe in-store mar­ket­ing efforts are most impor­tant in terms of dri­ving sales for retail­ers and man­u­fac­tur­ers.

To learn more about spe­cif­ic food buy­ing audi­ences, such as in-store pro­mo­tion respon­ders,  check out the Audi­enceS­CAN report avail­able on the Research Store at ad​-olo​gy​.com.

Kathy Crosett
Kathy is the Vice Pres­i­dent of Research for Sales­Fu­el. She holds a Mas­ters in Busi­ness Admin­is­tra­tion from the Uni­ver­si­ty of Ver­mont and over­sees a staff of researchers, writ­ers and con­tent providers for Sales­Fu­el. Pre­vi­ous­ly, she was co-own­er of sev­er­al small busi­ness­es in the health care ser­vices sec­tor.